A Scarcity of __________ Can Make It Difficult for the Subsidiary

question 94

Short Answer

A scarcity of __________ can make it difficult for the subsidiary to import raw materials and spare parts for its production equipment.

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Definitions:

Increasing Marginal Product

A situation where each additional unit of input results in an increased amount of output.

Economic Rents

Extra earnings above the minimum amount necessary to keep a factor of production in its current use.

Accounting Costs

The explicit costs of a business, representing the actual outflows of cash for wages, rent, materials, and other tangible inputs.

Economic Costs

The total cost of choosing one action over another, including both explicit (direct monetary costs) and implicit (opportunity costs) factors.